In goats, the PIS (polled intersex syndrome) mutation is responsible for both the absence of horns in males and females and sex-reversal affecting exclusively XX individuals. The mode of inheritance is dominant for the polled trait and recessive for sex-reversal. In XX PIS-/- mutants, the expression of testis-specific genes is observed very precociously during gonad development. Nevertheless, a delay of 4-5 days is observed in comparison with normal testis differentiation in XY males. By positional cloning, we demonstrate that the PIS mutation is an 11.7-kb regulatory-deletion affecting the expression of two genes, PISRT1 and FOXL2 which could act synergistically to promote ovarian differentiation. The transcriptional extinction of these two genes leads, very early, to testis-formation in XX homozygous PIS-/- mutants. According to their expression profiles and bibliographic data, we propose that FOXL2 may be an ovary-differentiating gene, and the non-coding RNA PISRT1, an anti-testis factor repressing SOX9, a key regulator of testis differentiation. Under this hypothesis, SRY, the testis-determining factor would inhibit these two genes in the gonads of XY males, to ensure testis differentiation.